Irish technology companies raised €109m in the 3rd quarter bringing to €220m the amount raised in the year to September 2009, according to the latest VenturePulse survey issued by the Irish Venture Capital Association (IVCA).
“Investment raised in the third quarter increased by 55% on last year with the number of companies involved increasing by 25%,” commented IVCA chairman, John Tracey. “This is against a background of a global credit crunch and significant falls in venture capital activity levels around the world.”
In the boom years, about €200 was raised annually in venture capital while billions of euros went towards overseas commercial property investment.
Irish property overseas investment this year has plunged to €86 million compared with €2.1 billion in 2008 and €9.9 billion in 2007 - - when the Irish were the second biggest investors in commercial property across Europe.
The IVCA figures were welcomed by Conor Lenihan TD, Minister for Science, Technology & Innovation. ”It is particularly significant that over 20% or €48.3m of funds raised this year were in the area of early stage or seed capital.”
He also welcomed the broad base of Irish technology firms raising funds, from pharma/biotechnology to environmental technology. “This is helping to establish the building blocks of a smart economy and is positive for the future development of an indigenous knowledge economy.”
Regina Breheny, director general of the IVCA, said that funding for the year to September increased by 26% to €219.6m from €174.3m in the same period of 2008 and €141.5m in the nine months of 2007.
The number of companies that raised funds in this period was 86, compared to 64 in the same period in 2008 and to 73 in 2007. Amounts raised ranged from €50K to €47m.
She said that Irish tech firms continued to attract interest from international investors as well as local VC firms. 21 Irish based venture capital funds and private investors were involved (157 investments and 56% of funds raised) and 34 International funds and private investors (36 investments and 44% of funds raised).
Among the bigger investments, Blue Ocean Wireless, a provider of mobile phone services to merchant ships, raised €7.5 million from three of its largest shareholders: Philippines telco Smart Communications; NTT DoCoMo, Japan’s biggest mobile phone provider; and Tralee-based software group Altobridge.
Powervation, a Limerick-based semiconductor firm raised €7.25 million from investors including Intel Capital, Venture Tech, Scottish Equity Partners and 4th Level Ventures, while medical device manufacturer Capella raised €7 million from venture investors including ACT Venture Capital and State development agency Enterprise Ireland.
Last month, a new €26 million fund for investing in start-up and early stage companies was announced by Tánaiste and Minister for Enterprise, Trade and Employment, Mary Coughlan.
The Bank of Ireland Seed and Early Stage Equity fund will invest in export-oriented high potential firms that operate in the technology, food and financial services sectors, in addition to supporting patent and patent pending projects within Irish universities.
The fund will target investments in the range of €100,000 and €500,000.
The new fund, which will be managed by Kernal Capital, comprises of a €17 million investment by Bank of Ireland, along with funding of €8 million from Enterprise Ireland and € 1million by the University of Limerick Foundation. It will be managed by Kernel Capital.
SECTORS – Year to Date (Sept) 2009
In the Pharma/Biotechnology sector, 9 (10%) companies raised €76.7m (35%).
In the drug delivery and medical device sector, 15 (17%) companies raised €32.4m (15%).
In the telecoms sector, 7 (8%) companies raised €7.7m (3%).
In the environment technology sector, 10 (12%) companies raised €22.2m (10%).
Other technology (including nano technology, fibre optics, photonics and semiconductor chips) servicing a wide range of industries, 15 (17%) companies raised €43.2m (20%).
In the business services sector, 19 (22%) companies raised €15.6m (7%).
Other 11 (14%) companies raised €21.8m (10%).
SEED/EARLY STAGE – Year to Date (Sept) 2009
In this period 39 companies raised €48.3m (22% of funds raised).
